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Tuesday, Jul 8, 2014 4:50 PM UTC
Let’s nationalize Amazon and Google: Publicly funded technology built Big Tech
They're huge and ruthless and define our lives. They're close to monopolies. Let's make them public utilities
Topics: amazon, Jeff Bezos, Books, Editor's Picks, Google, Netflix, eric schmidt, Facebook, Privacy, Innovation News, Technology News, Business News
They’re huge, they’re ruthless, and they touch every aspect of our daily lives. Corporations like Amazon and Google keep expanding their reach and their power. Despite a history of abuses, so far the Justice Department has declined to take antitrust actions against them. But there’s another solution.
Is it time to manage and regulate these companies as public utilities?
That argument’s already been made about broadband access. In her book “Captive Justice,” law professor Susan Crawford argues that “high-speed wired Internet access is as basic to innovation, economic growth, social communication, and the country’s competitiveness as electricity was a century ago.”
Broadband as a public utility? If not for corporate corruption of our political process, that would seem like an obvious solution. Instead, our nation’s wireless access is the slowest and costliest in the world.
But why stop there? Policymakers have traditionally considered three elements when evaluating the need for a public utility: production, transmission, and distribution. Broadband is transmission. What about production and distribution?
The Big Tech mega-corporations have developed what Al Gore calls the “Stalker Economy,” manipulating and monitoring as they go. But consider: They were created with publicly funded technologies, and prospered as the result of indulgent policies and lax oversight. They’ve achieved monopoly or near-monopoly status, are spying on us to an extent that’s unprecedented in human history, and have the potential to alter each and every one of our economic, political, social and cultural transactions.
In fact, they’re already doing it.
Public utilities? It’s a thought experiment worth conducting.
Big Tech was created with publicly developed technology.
No matter how they spin it, these corporations were not created in garages or by inventive entrepreneurs. The core technology behind them is the Internet, a publicly funded platform for which they pay no users’ fee. In fact, they do everything they can to avoid paying their taxes.
Big Tech’s use of public technology means that it operates in a technological “commons,” which they are using solely for its own gain, without regard for the public interest. Meanwhile the United States government devotes considerable taxpayer resource to protecting them – from patent infringement, cyberterrorism and other external threats.
Big Tech’s services have become a necessity in modern society.
Businesses would be unable to participate in modern society without access to the services companies like Amazon, Google and Facebook provide. These services have become public marketplaces.
For individuals, these entities have become the public square where social interactions take place, as well as the marketplace where they purchase goods.
They’re at or near monopoly status – and moving fast.
Google has 80 percent of the search market in the United States, and an even larger share of key overseas markets. Google’s browsers have now surpassed Microsoft’s in usage across all devices. It has monopoly-like influence over online news, as William Baker noted in the Nation. Its YouTube subsidiary dominates the U.S. online-video market, with nearly double the views of its closest competitor. (Roughly 83 percent of the Americans who watched a video online in April went to YouTube.)
Even Microsoft’s Steve Ballmer argued that Google is a “monopoly” whose activities were “worthy of discussion with competition authority.” He should know.
As a social platform, Facebook has no real competitors. Amazon’s book business dominates the market. E-books are now 30 percent of the total book market, and its Kindle e-books account for 65 percent of e-book sales. Nearly one book in five is an Amazon product – and that’s not counting Amazon’s sales of physical books. It has become such a behemoth that it is able to command discounts of more than 50 percent from major publishers like Random House.
They abuse their power.
The bluntness with which Big Tech firms abuse their monopoly power is striking. Google has said that it will soon begin blocking YouTube videos from popular artists like Radiohead and Adele unless independent record labels sign deals with its upcoming music streaming service (at what are presumably disadvantageous rates). Amazon’s war on publishers like Hachette is another sign of Big Tech arrogance.
But what is equally striking about these moves is the corporations’ disregard for basic customer service. Because YouTube’s dominance of the video market is so large, Google is confident that even frustrated music fans have nowhere to go. Amazon is so confident of its dominance that it retaliated against Hachette by removing order buttons when a Hachette book came up (which users must find maddening) and lied about the availability of Hachette books when a customer attempts to order one. It also altered its search process for recommendations to freeze out Hachette books and direct users to non-Hachette authors.
Amazon even suggested its customers use other vendors if they’re unhappy, a move that my Salon colleague Andrew Leonard described as “nothing short of amazing – and troubling.”
David Stratfield of the New York Times asked, “When does discouragement become misrepresentation?” One logical answer: When you tell customers a product isn’t available, even though it is, or rig your sales mechanism to prevent customers from choosing the item they want.
And now Amazon’s using some of the same tactics against Warner Home Video.
They got there with our help.
As we’ve already noted, Internet companies are using taxpayer-funded technology to make billions of dollars from the taxpayers – without paying a licensing fee. As we reported earlier, Amazon was the beneficiary of tax exemptions that allowed it to reach its current monopolistic size.
Google and the other technology companies have also benefited from tax policies and other forms of government indulgence. Contrary to popular misconception, Big Tech corporations aren’t solely the products of ingenuity and grit. Each has received, and continues to receive, a lot of government largess.
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